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Contact Center Outsourcing vs. Contact Center Automation

Simone Somekh

August 29, 2022

Companies all over the world spend billions of dollars on contact centers. In 2020, the global contact center market size was estimated to be over $339 billion, and that number is projected to grow significantly over the next decade.

Whenever a company invests in their contact center — whether it’s in-house or outsourced — they end up spending most of the budget on staffing, and significantly less goes to fund the technology. Even then, contact centers are dealing with major staff shortages that have caused customer service wait times to skyrocket.

In this article, we’ll discuss the pros and cons of contact center outsourcing, and we’ll compare them with the benefits of contact center automation with innovative conversational voice AI solutions.

What Is Contact Center Outsourcing?

Over the last decade, many companies have begun outsourcing their contact center operations. Contact center outsourcing is the use of contracted labor from a third-party source or organization to manage a company’s contact center and customer service operations. These third-party sources are commonly known as business process outsourcing (BPO) and they are often located offshore.

As a result of outsourcing, staffers who do not work directly for your company will handle all of your communications with your customers; they will be the ones to pick up the phone when you receive an inbound call from a disgruntled customer or a technical question related to your products or services. Additionally, customer interactions that may be handled by the BPO may include social media (e.g. Twitter), live chat, and email.

It’s common for contact center outsourcing to take place offshore, as it’s typically cheaper to manage these operations abroad.

The Benefits of Outsourcing Your Contact or Call Center

Here are some of the most relevant pros of outsourcing your contact center:

It’s cheaper. This is not to say that it’s cheap—just that it’s cheaper than running your in-house contact center. Hiring, training and managing staffers is expensive, in addition to the expenses related to the facilities and equipment required to run the center. Unloading all of these challenges to an external organization that is familiar with this type of operation is likely to save you a significant amount of money.

It’s one less headache. Money aside, managing a contact center can be a major headache, especially when dealing with the current attrition rates, which are very high, and short-staffing issues. If you are not ready to invest the time that goes into this type of operation, outsourcing may be worth looking into.

Customer service around the clock. Offering 24/7 customer service has become the key to a successful customer experience. However, maintaining an in-house team of customer care specialists that can deliver 24/7 service is a challenge most businesses cannot handle.

It allows for some scaling flexibility. As your business grows, customer queries will grow, too, and you’ll need to seamlessly scale up your service operations. Additionally, temporary crises and unexpected events can cause query and call volume surges, which are difficult to manage for a smaller, in-house contact center.

The Disadvantages of Contact Center Outsourcing

Yes, contact center outsourcing may have its perks, but it’s not the perfect solution to all of your contact center needs. Here are some of the disadvantages:

Limited control over your contact center. Outsourcing means trusting a third-party organization to manage your interactions with customers. While as a business you often have to rely on other companies and solutions, when you outsource your contact center you accept that you will likely have limited control over its operations.

Limited knowledge of your company. BPOs typically service many companies, which means that your contact center agents may be assigned to work with other companies, as well. Additionally, because they don’t work directly for you, the agents are likely to have a limited knowledge and expertise of your company and the products and solutions you offer; by definition, the outsourced agents will be less exposed to your company and will not be able to regularly communicate with other departments within your organization.

It’s still expensive. Yes, outsourcing is relatively cheaper than creating and managing an in-house contact center, but it’s still a very large investment. Additionally, if your customer experience deteriorates because of the poor customer support, then you will end up losing customers, which will directly affect your profit.

What Is Contact Center Automation?

Contact center automation is the process of adopting technological solutions that process and respond to customer service queries automatically, boosting the center’s efficiency, bringing down costs, and offloading human agents of repetitive, tedious tasks. In this article, we are focusing specifically on voice automation, which consists in the adoption of a voicebot.

As maintaining a contact center has become an increasingly expensive and complex operation, more businesses have been looking into automation as an ideal solution to the customer service crisis. Especially for the more simple customer queries, automation can be an easy-to-implement solution that leaves customers satisfied by easily solving their most common issues.

Skit’s Digital Voice Agent is a prime example of contact center automation, as it’s an purpose-built and industry-specific AI-powered agent that can converse with customers, answer their questions, and process their requests as needed.

Does automation mean that human agents are no longer needed? Absolutely not. At Skit.ai, we are firm believers in the power of Augmented Intelligence, which sees human agents partner with artificial intelligence to provide a seamless customer experience.

Dive deeper: Voice AI — The Biggest Contact Center Automation Trend

Benefits of Contact Center Automation as Opposed to Outsourcing

Significantly cheaper. You can adopt an AI-powered Digital Voice Agent at a fraction of the cost of a team of human agents. Some estimate that businesses that adopt voice automation save approximately 50% of what they were previously spending on their call center.

Direct control over your use cases. As opposed to an outsourced human agent, the Digital Voice Agent is built with your company’s specific needs in mind. Before it’s built, you get to express all of your needs; even afterwards, you can tweak it and improve its performance or add new use cases as needed by easily using Skit’s Studio platform.

Empowering human agents. For more complex queries or issues, the Digital Voice Agent escalates the call to a human agent—while providing the human agent with the appropriate context. You can read more about how Voice AI empowers human agents in this article.

Customer verification is much faster. Human agents typically spend 4-5 minutes just to verify the identity of the customer or caller at the beginning of the call. A Digital Voice Agent can do it in just a couple of minutes, costing you less resources.

24/7 support. We’ve already pointed out the importance of 24/7 customer support for seamless CX. The Digital Voice Agent never sleeps, and it doesn’t take a single day off.

Are you curious to see how Skit’s Augmented Voice Intelligence solution works? Would you like to see a demo of our product and speak with an expert? Schedule a call with one of our experts using the chat tool below!


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